I move: "That the Bill be now read a Second Time."
This Bill will allow the Minister for Finance to issue a set of coins to commemorate the Irish Presidency of the European Council and also permits the issue of a new £1 coin. It also proposed to amend the decimal currency Acts to permit a change in the metallic composition of the 1p and 2p. I am confident that the House will support the proposals in the Bill.
The Irish Presidency of the EC Council will see the putting in place of many of the final building blocks of the 1992 objective. Developments in Europe generally are likely to make this period one of historic significance. The issue of a commemorative coin will be an enduring reminder of the Irish Presidency.
The Government have decided to issue the coins in gold and silver. The coins will be purely commemorative and not legal tender. Other member states have issued commemorative coins in the past. Most recently Spain produced a set of five coins in precious metals to mark their first presidency of the Council.
The coins will be issued by the Central Bank and will consist of a series of three — a gold 50 ECU piece, a silver coin 10 ECU, and a silver 5 ECU piece. The gold coin and smaller silver coin will be roughly the same size as the 10p while the larger silver coin will be of "crown" size, that is somewhat larger than the old half crown. The gold coin will be 22 carat gold and the silver coins will be sterling silver. They will be issued in proof standard to encourage interest among coin collectors.
It is envisaged that the gold coin will be priced in the region of £250. The larger silver coin will cost £20 to £25 while the smaller silver coin will be priced at £10-£15. These prices are tentative since much depends on the value of gold and silver at the time of purchase of the metals. However, the intention is that while the gold coin and larger silver coins will be of interest mainly to collectors the smaller silver coin at £10 to £15 should be accessible to the ordinary citizen who wishes to have a keepsake of the occasion.
This is our first step into the market of specialised coins. There are certain risks associated with the issue of precious metal coins. The metals must be purchased in advance and may fall in price subsequently thus affecting market value. There is also the risk that market demand may not be as strong as anticipated.
On the advice of the Central Bank, it is proposed to issue 5,000 gold coins, 20,000 of the larger silver coins and 20,000 of the smaller silver coin. These are the minimum levels necessary to offset the manufacturing costs. An issue of this size will, it is felt, minimise, the risks and enhance the scarcity value for collectors.
The question of design is obviously a matter of importance. The Government decided that the design of the red deer selected for the £1 coin, on which I will comment later, should be retained for the ECU coin. Given the increased awareness about conservation of the environment, the symbol of the Irish red deer is very appropriate. The use of this theme will also increase interest in our coinage abroad.
On the obverse side, it is intended to reproduce the harp surrounded by the 12 stars which is the logo of the Community. The coin denomination will appear on this side also. The use of the stars is common to issues by other countries and again symbolises this country's adherence to the Community.
I now turn to the other main purpose of the Bill — that is the £1 coin. The question of a £1 coin has been under consideration for some time. The short lifespan of the pound note, combined with rising costs of production, has made it an unattractive proposition to continue to produce notes of this denomination. In addition, many people, including several Deputies in this House, have commented on the ragged appearance of our notes once they have been in usage for some time. It is not good for the image of the currency, or indeed the country, to have notes in circulation in a less than acceptable state.
The Government have decided that it is opportune to introduce a £1 coin. They considered this matter very carefully from all aspects. Many other States have coins of a denomination roughly equivalent to the Irish pound.
At present the bank issues roughly 59 million notes per annum and these have a life expectancy of only six months. About 50 million £1 coins will be issued initially and an issue of about 3 million per annum will be sufficient to ensure there is enough in circulation. The lifespan of 40 years for each coin is a considerable cost-saving factor. The cost of changing to the £1 coin will be recouped within five to seven years.
The Bill sets out the weight and metallic composition of the coin. The metals used are copper and nickel, similar to the existing 5p, 10p and 50p. The weight is 10 grammes — lighter than the 50p and the 10p, the coin will be 31.1 mm in diameter and 1.7 mm in thickness.
The Bill, however, does not mention what many would consider the most important aspect — the design of the coin. This will be the subject of an order under section 3 of the Decimal Currency Acts, 1969 to 1989 which I will make when the Bill is enacted.
The Government decided that a special design should be commissioned for the new coin. The design chosen for the coin, as I said earlier, is that of the Irish red deer. I have made sample coins available for inspection by Deputies. I am confident that the design will find favour with the public. The red deer is native to this country and is a striking and majestic animal of which we are proud. The deer has been under threat but active conservation is ensuring that it will be preserved for future generations. The Arts Council who were consulted at an early stage agreed with the choice of a deer.
Mr. Tom Ryan, President of the Royal Hibernian Academy, was commissioned to prepare the drawings based on photographs of actual red deer submitted by Mr. Seán Ryan of County Cork, an acknowledged expert in this field. Mr. Tom Ryan had already designed the motif for the 50p piece issued to mark the Dublin Millennium celebrations. I should like to thank both these gentlemen for the pains they took in advising the Government in this regard.
As with all new coins, many organisations have been consulted, for example, the users and makers of coin operated machines and representatives of the visually impaired. To help the visually impaired, the coin will contain special features to distinguish it from other coins.
Firstly, the size and weight alone will be of assistance to the blind. In addition, the milling on the edge has been so constructed that it will be recognisable by touch. This milling is unique to the £1 coin. In addition, the coin has a beaded edge around the circumference of the coin which is again unique to the coin.
The Government's aim is to overhaul the coinage fully over the next three to four years. The introduction of the £1 coin is but one of many changes which we will see. I am concerned that the coinage, generally, is too heavy and we will be endeavouring to reduce the weight of the coins where possible. The first priority in 1991 will be the issue of a new, lighter and round 50p. The coin will be reduced in size by about 5mm and will carry the current woodcock design.
Next it is planned to issue a new 5p and 10p on which the two existing designs, the bull and the salmon, will be reversed to face left. This will give a uniform orientation to all the motifs. Both coins will be reduced in size. The metallic composition of both coins will be altered to make them lighter.
For the 1p and 2p coins it is proposed to revert to the Metcalfe designs. The 1p will feature the Irish wolfhound from the old sixpence while the 2p will have the hare which appeared on the pre-decimal 3p.
My Department consulted the Arts Council on the designs and I have taken on board most of their suggestions. I am grateful to the Arts Council for their advice and we will consult the council further as appropriate.
The Bill also allows for a change to the 1p and 2p. These coins are made of bronze at present and cost more than their face value to produce. The Central Bank have recommended that the metallic composition of these coins should be altered in advance of the design changes I spoke about earlier. It is proposed that the current metallic composition should be replaced by a copper covered steel core. There will be no change in the dimension, size, weight or design of the coins.
This change in metallic composition will enable the bank to break even on the production of these coins. Coins of this sort are common on the Continent and I note that the UK Royal Mint have recently announced a similar change.
I now turn briefly to the provisions of the Bill. Section 1 deals with definitions and is self-explanatory. Section 2 relates to the ECU coins. Subsection (1) allows for the issue of coins in ECUs in such sizes, metallic composition, design and weights as the Minister for Finance may decide. Subsections (2) and (3) allow the coins to be sold through the Central Bank at a price determined by the Minister. Subsection (4) provides that the coins will not be legal tender.
Subsections (5) and (6) apply certain sections of the Decimal Currency Act, 1969, to coins issued under section 2. By virtue of these the Central Bank will bear the expenses of the issue and the income from the sale of the coins will accrue to the bank. The bank will also bear the cost of any redemption.
Subsection (7) applies to section 57 of the Copyright Act, 1963, and vests the copyright in the design in the Minister for Finance. This is a standard provision of coinage legislation. Section 3(a) inserts a new section 4A in the Decimal Currency Act, 1969, to enable the provision of 1p and 2p coins in the form of copper coins with a steel core.
Section 3 (b) is a technical amendment of section 14 of the Decimal Currency Act, 1969, to include a reference in that section to coins issued under section 2 of this Bill.
Section 3 (c) amends the First Schedule to the Decimal Currency Act, 1969, to provide for the issue of a £1 coin. The amended Schedule specifies the standard weight and composition of the coin and the permitted variation from these standards. The size and design of the coin will be dealt with separately by an order under the 1969 Act.
Section 4 is the Short Title and construction of the Bill.
Coinage is one of those issues on which everybody has an opinion. It is, I know, a subject on which some people have strong feelings. The coinage is an important symbol of our nationalhood and a symbol of which we should be proud. The designs on our coins are of a recognised high standard and the Government are anxious to ensure that these should remain so. I am happy that the new £1 coin, and the coins to follow in the future, will be well received by the public. I commend the Bill to the House.